STATE BANK OF PATIALA vs. COMMISSIONER OF INCOME TAX, PATIALA
What did the High Court hold?
The High Court, upon agreement of both parties, set aside the impugned order. The matter was remanded back to the Tribunal for passing a fresh order in accordance with law, considering subsequent Supreme Court and Tribunal decisions.
What were the facts?
The State Bank of Patiala appealed against an ITAT order for AY 2009-10. The appeal involved three key issues: disallowance under Section 14A, applicability of Section 41(4) regarding bad debts, and disallowance of unclaimed balances in a Nostro-Blocked account.
What were the issues?
The core issues revolved around the disallowance of expenses related to tax-exempt income, the taxability of recovered bad debts where no deduction was previously claimed, and the treatment of unclaimed balances in a Nostro-Blocked account.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ****
201-2
ITA-200-2012 Date of Decision: 19.12.2025 STATE BANK OF PATIALA, PATIALA ...Appellant Vs. COMMISSION OF INCOME TAX, PATIALA
…Respondent
CORAM:- HON'BLE MR. JUSTICE JAGMOHAN BANSAL HON'BLE MR. JUSTICE AMARINDER SINGH GREWAL
Present:- Mr. Sanjay Bansal, Sr. Advocate with Mr. Gurdeep Singh, Advocate Mr. Sushrut Singla, Advocate and Mr. Iman Singla, Advocate for appellant-State Bank of Patiala
Mr. Saurabh Kapoor, Sr. Standing Counsel (through V.C.) with
Mr. Rana Gurtej Singh, Jr. Standing Counsel and
Ms. Muskaan Gupta, Advocate
for respondent-Income Tax Department
*** JAGMOHAN BANSAL, J. (ORAL)
The appellant through instant appeal under Section 260A of Income Tax Act, 1961 (for short ‘1961 Act’) is seeking setting aside of order dated 16.05.2012 passed by Income Tax Appellate Tribunal, Chandigarh Bench, Chandigarh (for short ‘Tribunal’) for the Assessment Year 2009-10. 2.
Learned counsel for the parties are ad idem that three issues are involved namely (i) Disallowance under Section 14(A) on the securities held in stock; (ii) Applicability of Section 41(4) read with 36(1)(vii) with respect to recovery of bad debts which were written off in the earlier assessment years, however, deduction was never claimed; and (iii) Disallowance of DEEPAK BISSYAN 2025.12.22 10:07 I attest to the accuracy and integrity of this document
ITA-200-2012
-2-
unclaimed balance in Nostro-Blocked account. 3.
They further concede that matter may be remanded to Tribunal to pass fresh order, in the light of orders passed by Hon’ble Supreme Court as well as Tribunal itself after passing of impugned order. 4.
In the wake of statement of both sides, the impugned order is hereby set aside and matter is remanded back to Tribunal for passing fresh order in accordance with law. 5.
Disposed of in above terms. 6.
Pending application(s), if any, stands disposed of.
(JAGMOHAN BANSAL)
JUDGE
(AMARINDER SINGH GREWAL)
JUDGE December 19, 2025 Deepak DPA
Whether Speaking/reasoned Yes/No
Whether Reportable
Yes/No DEEPAK BISSYAN 2025.12.22 10:07 I attest to the accuracy and integrity of this document
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